I care aboutthem all and read it like the matrix. Tools like Mometic.com and stock-touch give me a much more visual read if you can handle the thought required. Otherwise just stare at a line chart!!!
Why Do We Still Care About the Dow? (2012)
11–14 of 14 posts
Re: Why Do We Still Care About the Dow? (2012)
#12"None of these criticisms will come as news to finance professionals, most of whom use far more precise measures — like the S&P 500 or the Wilshire 5,000, which cover more companies more precisely — when making investing decisions." Never understood the Dow. Never understood the importance of a healthy 3-5 percent interest rate until now. I used to make $500/yr. on my cd. I now make $9/year on a .1 percent rate. Have…
Stock market is not that risky in the very long term, say, 10 years or more, if done well.
And by "done well" I do not mean predicting ups and downs, but having a diversified portfolio (investing everything in one company is not a good idea, does not matter how promising or established it looks), which is doable with all the investment funds out there that ask for a very low minimum investment.
Check these books:
http://www.amazon.com/Intelligent-Investor-Definitive-Invest...
http://www.amazon.com/Little-Book-Common-Sense-Investing/dp/...
Re: Why Do We Still Care About the Dow? (2012)
#13The story missed the original purpose of the Dow with was a leading economic indicator... watch prices of the industrial giants to see broader market moves ahead of the market, at least optimistically. Not a terribly bad idea although info theory kicked in and once everyone knew and applied the theory the price results got baked into the cake of the prices themselves so it was no longer a money maker. That and changi…
"Our equity prices now mostly represent central bank interest rates."
What are you talking about?. I fear you may be confusing the Fixed Income market with the Equity market.
Equities (in general, as a class), are negatively correlated with interest rates. Specific sectors though (e.g. Banks) may be more positively correlated to interest rates - but overall, the link is tenuous, at best.
Re: Why Do We Still Care About the Dow? (2012)
#14The story missed the original purpose of the Dow with was a leading economic indicator... watch prices of the industrial giants to see broader market moves ahead of the market, at least optimistically. Not a terribly bad idea although info theory kicked in and once everyone knew and applied the theory the price results got baked into the cake of the prices themselves so it was no longer a money maker. That and changi…
"Our equity prices now mostly represent central bank interest rates." What are you talking about?. I fear you may be confusing the Fixed Income market with the Equity market. Equities (in general, as a class), are negatively correlated with interest rates. Specific sectors though (e.g. Banks) may be more positively correlated to interest rates - but overall, the link is tenuous, at best.
"Equities (in general, as a class), are negatively correlated with interest rates."
We're not disagreeing, although I was less clear than your line above.